Medicare Advantage and Financial, Hospital, and Community Characteristics of Rural Hospitals

As of March 2022, 28.8 million Medicare beneficiaries were enrolled in Medicare Advantage (MA) plans, which is 45.7 percent of all beneficiaries. Overall, MA enrollment grew by 8.7 percent (2.3 million) from 2021 to 2022; the rate of growth was higher in nonmetropolitan counties (13.4 percent) than in metropolitan counties (7.9 percent). The rapid growth of the number of beneficiaries in MA plans can have substantial financial consequences on hospitals. Rural hospital executives have expressed concern about MA in comparison to traditional Medicare, stating that MA plans citing factors could directly or indirectly affect profitability and increase the likelihood of financial distress and closure of rural hospitals.

This project compared financial, hospital, and community differences among rural hospitals located in areas with lower versus higher rates of MA penetration. Results increased our understanding of financial, hospital, and community differences among rural hospitals in areas with lower versus higher rates of MA penetration.

Publications

• Medicare Advantage and Rural Hospital Profitability
  Journal Article
  North Carolina Rural Health Research and Policy Analysis Center
  Date: 01/2025
  Researchers compared the profitability of rural and urban hospitals located in varying rates of Medicare Advantage (MA) penetration. Results will increase our understanding of rural hospitals in areas with lower versus higher rates of MA penetration.